Govt disconnects Mumbai from power tariff cutback

While the cabinet has approved a 20% reduction in rates for consumers of Maharashtra State Electricity Distribution Company, Mumbaikars will not be able to draw any benefit from this

Members of parliament from the city Priya Dutt and Sanjay Nirupam had championed demands – through protests, public meetings, dharnas outside power distributing companies and meetings with top ministers, including Prithviraj Chavan for a reduction in electricity prices. So, the cabinet decision on the matter yesterday must have come as a high-voltage shock for them and for other Mumbaikars.

Since the AAP government in Delhi reduced electricity rates, Mumbai MPs Priya Dutt and Sanjay Nirupam have been demanding a similar cutback in the city. File pics

While the government approved a 20% cut in power tariff for consumers, comprising domestic, agriculture, industries and powerloom, of the state-run Maharashtra State Electricity Distribution Company, Mumbaikars have been completely sidelined.

Ever since the AAP-led Delhi government reduced power rates, politicos here have made it their poll pitch, demanding a similar cutback. On January 23, Sanjay Nirupam will organise a hunger strike, demanding lower tariffs, especially in western suburbs (Bandra-Dahisar and even beyond, in select locations), which receive supply from Reliance Infrastructure.

Politicians claim that the people in Mumbai have been forced to pay exorbitant sums for electricity. As per the current tariff structure, someone who gets supply from RInfra, and consumes anywhere between 301-500 units a month, will pay Rs 9.12 per unit. Similarly, those using Tata Power pay Rs 6.25 per unit in the same bracket, while Rs 7.79 per unit is the amount paid by BEST consumers in this range.

“There needs to be parity in the rates in Mumbai. Why should people pay different prices in suburbs and the city? We will continue to put pressure on the state government to reduce prices in Mumbai as well,” said Priya Dutt. There are more than 26 lakh consumers of RInfra, 4 lakh of Tata Power and 10 lakh of BEST.

Meanwhile, Nirupam claims that his fight against RInfra will continue. “CM Chavan has assured us that power tariffs in Mumbai too will come down in the near future. If it doesn’t happen then we will protest against the government. In the meantime, we will continue to protest in front of RInfra office, as we want them to reduce the surcharge,” he said.

The reduction has been planned strategically, keeping in mind the forthcoming elections, as largely consumers of industrial and agricultural classes will benefit from the 20% cutback. The state cabinet accepted the recommendations of a high-powered committee led by Narayan Rane, which suggested a 20 per cent power subsidy for users for a 10-month period till the state elections in October.

The financial burden of a 20 per cent subsidy would work out to Rs 706 crore every month, of which the state will bear Rs 600 crore, while rest will be supported by MahaVitaran, the distribution company of Maharashtra State Electricity Board (MSEB). Incidentally, the distribution arm of MSEB supplies to areas like Mulund, Bhandup, Vikhroli, Thane and Navi Mumbai too.

Govt can give subsidy: ExpertsPower experts claim that under section 65 of Electricity Act 2003, the state government can give subsidy to particular sections of consumers. “There is no need for the Maharashtra Electricity Regulatory Commission to approve this, as the state government has the right to offer subsidy. The only thing is that the government will then have to bear the losses without affecting consumers,” said a senior bureaucrat and power expert. The state government can also give subsidy through taxes in sale of electricity and/or electricity duty. As an alternative it can come up with a completely new subsidy for this.

Rs 706 crBurden of subsidy on the exchequer every month owing to the subsidy